Insurance regulator Irdai Thursday said it has imposed fine of Rs 5 lakh each on Iffco Tokio and Royal Sundaram for violating motor tariff claims and file & use guidelines.
Both Iffco Tokio General Insurance and Royal Sundaram General Insurance face similar charges of settling lesser amounts than the insured declared value in case of motor vehicle total loss/theft claims, as per two separate orders against the two firms.
The authority had conducted focussed onsite inspection of the insures in matters related to total loss and/or theft claims during the period 2009-10 and 2010-11, the Insurance Regulatory and Development Authority of India (Irdai) said in its orders.
"After considering all the factors, I am of the opinion that the charges relating to total loss/constructive total loss claims confirmed and the samples given (by them) stand testimony to this," said the similarly worded orders signed by Irdai member (non-life) P J Joseph.
Irdai also said the companies violated File & Use guidelines and circulars issued by it from time to time advising insurers that they shall continue to use the coverage, terms & conditions, wordings, warranties, clauses and endorsements of the erstwhile tariff of classes of insurance covers until further orders.
"The penalty of Rs 5 lakh shall be remitted by the insurer(s) through NEFT/RTGS by debiting shareholders' account within a period of 15 days from the date of receipt of this order," Irdai said.
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